NEW YORK (TheStreet) -- As technology companies continue to generate and hoard cash, some, like Amazon (AMZN) - Get, Inc. Report, are looking at acquiring others to broaden offerings paving the road to prosperity for the Internet HOLDRs (HHH) , the Retail HOLDRs (RTH) - Get VanEck Vectors Retail ETF Report, and the PowerShares NASDAQ Internet (PNQI) - Get Invesco NASDAQ Internet ETF Report exchange-traded funds.

Amazon, which was sitting on cash and short-term securities of $5.9 billion at the end of September, has reached an agreement to buy


, owner of and Furthermore, the Seattle based online retailer recently bought, a site that offers a daily discounted item and has agreed to purchase BuyVIP, a fashion site, which will expand its presence in Europe.

The acquisition of Quidsi will allow Amazon to penetrate a market of parents who have young children that use diapers and offers the ability to have this necessity delivered directly to the consumers' front door. Additionally, the acquisition will take out a competitor in the e-commerce space making Amazon that much stronger.

At the end of the day, it appears that Amazon is utilizing its cash reserves to acquire firms, lessen competition, strengthen its market share in the e-commerce space and compete with retail giants


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Written by Kevin Grewal of SmartStops in Houston


Grewal has no positions in the securities mentioned


Kevin Grewal is the founder, editor and publisher of

ETF Tutor and serves as the editor at , where he focuses on mitigating risk and implementing exit strategies to preserve equity. Additionally, he is the editor at The ETF Institute, which is the only independent organization providing financial professionals with certification, education, and training pertaining to exchange-traded funds (ETFs). Prior to this, Grewal was a quantitative analyst at a small hedge fund where he constructed portfolios dealing with stock lending, exchange-traded funds, arbitrage mechanisms and alternative investments. He is an expert at dealing with ETFs and holds a bachelor's degree from the University of California along with a MBA from the California State University, Fullerton.